Debt Collection Act of 1996? To: " , WRD Archive File, Reston, VA " cc: "Isabelle Halley des Fontaines, Chief, Br. Admin. Mgmt. Sys., Reston, VA " Subject: Debt Collection Act of 1996? Mime-Version: 1.0 Content-Type: text/plain; charset="us-ascii" Date: Thu, 13 Feb 1997 11:21:22 -0500 From: "Isabelle Halley des Fontaines, Chief, Br. Admin. Mgmt. Sys., Reston, VA " Debt Collection Act of 1996? Question: > > Where can I get a copy of the Debt Collection Act of 1996? > > My bosses are having trouble believing that EFT for travel will > > become a mandated thing. They are unable or unwilling to > > believe that 3rd Party Drafts will not be used forever and ever! Subject: Information on the Debt Collection Improvement Act of 1996 CHAPTER 10 OF THE OMNIBUS CONSOLIDATED RESCISSION AND APPROPRIATIONS ACT OF 1996 PUBLIC LAW 104-134 DEBT COLLECTION AND IMPROVEMENT ACT OF 1996 SECTION 31001 (X) AMENDMENT TO 31 U.S.C. 3332 (x)(1) AMENDMENTS RELATING TO ELECTRONIC FUNDS TRANSFER. --Section 3332 of title 31, United States Code, popularly known as the Federal Financial Management Act of 1994, is amended-- (A) by redesignating subsection (e) as subsection (h), and inserting after subsection (d) the following new subsections: "(e)(1) Notwithstanding subsections (a) through (d) of this section, sections 5120 (a) and (d) of title 38, and any other provision of law, all Federal payments to a recipient who becomes eligible for that type of payment after 90 days after the date of the enactment of the Debt Collection Improvement Act of 1996 shall be made by electronic funds transfer. "(2) The head of a Federal agency shall, with respect to Federal payments made or authorized by the agency, waive the application of paragraph (1) to a recipient of those payments upon receipt of written certification from the recipient that the recipient does not have an account with a financial institution or an authorized payment agent. "(f)(1) Notwithstanding any other provision of law (including subsections (a) through (e) of this section and sections 5120 (a) and (d) of title 38), except as provided in paragraph (2) all Federal payments made after January 1, 1999, shall be made by electronic funds transfer. "(2)(A) The Secretary of the Treasury may waive application of this subsection to payments-- "(i) for individuals or classes of individuals for whom compliance imposes a hardship; "(ii) for classifications or types of checks; or "(iii) in other circumstances as may be necessary. "(B) The Secretary of the Treasury shall make determinations under subparagraph (A) based on standards developed by the Secretary. "(g) Each recipient of Federal payments required to be made by electronic funds transfer shall-- "(1) designate 1 or more financial institutions or other authorized agents to which such payments shall be made; and "(2) provide to the Federal agency that makes or authorizes the payments information necessary for the recipient to receive electronic funds transfer payments through each institution or agent designated under paragraph (1)."; and (B) by adding after subsection (h) (as so redesignated) the following new subsections: "(i)(1) The Secretary of the Treasury may prescribe regulations that the Secretary considers necessary to carry out this section. "(2) Regulations under this subsection shall ensure that individuals required under subsection (g) to have an account at a financial institution because of the application of subsection (f)(1)-- "(A) will have access to such an account at a reasonable cost; and "(B) are given the same consumer protections with respect to the account as other account holders at the same financial institution. "(j) For purposes of this section-- "(1) The term 'electronic funds transfer' means any transfer of funds, other than a transaction originated by cash, check, or similar paper instrument, that is initiated through an electronic terminal, telephone, computer, or magnetic tape, for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit an account. The term includes Automated Clearing House transfers, Fed Wire transfers, transfers made at automatic teller machines, and point-of-sale terminals. "(2) The term 'Federal agency' means-- "(A) an agency (as defined in section 101 of this title); and "(B) a Government corporation (as defined in section 103 of title 5). "(3) The term 'Federal payments' includes-- "(A) Federal wage, salary, and retirement payments; "(B) vendor and expense reimbursement payments; and "(C) benefit payments. Such term shall not include any payment under the Internal Revenue Code of 1986." (2) AMENDMENTS RELATING TO SUBSTITUTE CHECKS. --Section 3331 of title 31, United States Code, is amended-- (A) in subsection (b), by striking "subsection (c)" and inserting "subsection (c) or (f)"; (B) by redesignating subsection (f) as subsection (g); and (C) by inserting after subsection (e) the following new subsection: "(f) The Secretary may waive any provision of this section as may be necessary to ensure that claimants receive timely payments.". And here are some other pieces of info related to your questions-- Electronic Funds Transfer (EFT) Frequently Asked Questions From Treasury Financial Management Service: ----------------------------------------------------------- What payments are covered? All Federal payments, except IRS tax refunds, are covered by the legislation. These include recurring and nonrecurring salary, wage, retirement, benefit, vendor, travel, grants, loans, fees and all other Federal payments. The legislation also includes payments made from appropriated and nonappropriated funds and payments not disbursed by the Treasury. How does the legislation impact my Imprest Fund? All payments made from Imprest Funds are covered. Direct Deposit is available for all cash advances, travel reimbursements and spot award payments traditionally made by cash or third party drafts. In addition, government travel cards can be used to pay for travel related items and for cash advances. This legislation will give agencies statutory language that can be used as a basis for closing Imprest Funds. Imprest Fund closure is a government wide cash management goal which will create substantial benefits including savings from having to maintain the funds and the float lost on funds held outside the Treasury. See also the question below on third party drafts. Can my agency still use third-party drafts? Until January 1, 1999, an agency may use third party drafts including FedSelect checks as alternatives to Treasury checks and Imprest Fund cash for payments not covered under the July 26, 1996 implementation date. At that time a determination will be made concerning the use of third party drafts. However, we expect that FedSelect will continue as an alternative in exceptional cases when electronic payment is not feasible. Are there any waiver provisions for the first phase of implementation? There is only one waiver provision between the beginning implementation date of July 26, 1996 and the final implementation date of January 1, 1999 and that is for payment recipients who certify in writing that they do not have an account at a financial institution or authorized payment agent.